The online advertising market is heating up and Microsoft has decided to make a bold move by taking part in the social networking frenzy. On Wednesday, October 25th 2007, Microsoft has secured a deal to buy 1.6 percent of the ever growing social networking site Facebook for $240 million. This move helps increase the total value of the young site to an estimated $15 billion and at the same time strengthens a new model of online advertising.
To quote Ellen Lee and Ryan Kim, chronicle staff writers from the San Francisco Chronicle:
“Marketers are expected to spend about $1.2 billion worldwide on social-networking advertising this year, according to a research report by eMarketer. That could grow to $3.6 billion by 2011. Microsoft is betting big that Facebook’s rise is just in the early stages. Facebook remains second behind MySpace, but Facebook’s audience has grown from 13.3 million people last year to more than 30.6 million users in September, according to comScore, which measures Internet use.”
As a fan of Facebook, I myself just can’t wait to see what will happen with all this!
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